DIVYA DUBEY Vs. STATE OF U P

JUDGEMENT

(1.) Heard Sri Ashok Kumar, learned counsel for the petitioners and Sri U.K. Pandey, learned Standing Counsel for the respondents.

(2.) By this writ petition, the petitioners have prayed for quashing the recovery notice dated 10th January, 2012 issued by the Assistant Collector, Commercial Tax asking the petitioners to deposit the amount as per security/surety bond dated 16th July, 2011 of the petitioners. The consequent recovery citation dated 12th March, 2012 issued by the Tahsildar has also been prayed to be quashed. A writ of mandamus has been sought commanding respondents No.2 and 3 not to proceed against the petitioners in pursuance of the recovery notice dated 10th January, 2012 and recovery citation dated 12th March, 2012.

(3.) Brief facts of the case as emerge from writ petition are; M/s Barfani Contractors Private Limited (hereinafter referred to as the Company) is a registered company. The Company was also registered under the U.P. Value Added Tax Act, 2008 and under the Central Sales Tax Act. The Assistant Collector, Commercial Tax passed provisional assessment order on 3rd November, 2010 for the period April, 2010 to August, 2010 assessing the Company and issued demand for tax and interest. The demand notice to the tune of Rs.35,17,819/- was issued by the Deputy Commissioner, Commercial Tax. The Company filed an appeal against the provisional assessment order. The first appellate authority stayed 70% of the disputed amount by directing the Company to deposit 30% of the disputed amount. The Company feeling aggrieved by the appellate order dated 22nd January, 2011, filed a second appeal before the Commercial Tax Tribunal. The Tribunal vide order dated 3rd March, 2011 stayed realisation of 95% of the disputed tax subject to condition that the Company shall furnish adequate security for the stayed amount to the satisfaction of the assessing authority. In pursuance of the order of the Tribunal dated 3rd March, 2011, the security was given by the Company in which the petitioners were sureties. The security/surety was given for an amount of Rs.33,41,833/- which was 95% of the total disputed tax. By an order dated 7th October, 2011, the Deputy Commissioner, Commercial Tax assessed the Company for the year 2010-11 (provincial) and created a demand of Rs.70,50,000/- towards tax. The assessment order also referred provisional assessment orders for the months of April, 2010 to August, 2010. The final assessment order was issued for the entire year covering the period for which provisional assessment order was already issued. In essence, the final assessment order was clearly in accord with the provisional assessment order which was referred to and relied in the final assessment order and the demand of tax and interest, which was made by provisional assessment order, stood confirmed by final assessment order. After the final assessment order, a recovery notice dated 10th January, 2012 has been issued to both the petitioners, who had submitted sureties dated 16th July, 2011 in pursuance of the order of Tribunal staying 95% of the demand of tax. The petitioners filed an objection dated 22nd January, 2012 stating that final assessment order having been passed, the provisional assessment order stood merged and the demand created by provisional assessment order shall automatically come to an end and since the petitioners have not given any surety in context of final assessment order, no recovery can be made from the petitioners. The assessing officer having sent the recovery certificate to the Collector, the citation has been issued by the Tahsildar for recovery of Rs.33,41,833/-. This writ petition has been filed challenging the recovery notice and the citation.